Listen, folks, I’ve got some news for you. AI chip startup Graphcore is in a bit of a pickle. They need to raise some serious cash from investors soon if they want to keep their heads above water. These guys were once seen as a potential rival to Nvidia, the big dogs in the AI accelerator game. They had this fancy hardware called Intelligence Processor Unit (IPU), along with some slick software and cloud services. But here’s the thing, they reported a loss of over $200 million for the last financial year. Ouch! That’s a big hit. And they’re not expecting things to get better in 2023 either. They’re still investing in product development, which means more losses on the horizon.
But hey, it’s not all doom and gloom. They did manage to bring in $2.7 million in revenue for 2022, even though that’s down 46 percent from the previous year. The company blames the wider economic environment for this, saying that demand for hardware sales wasn’t as strong as they had hoped. So, they made some tough decisions to cut costs. They closed down operations in Norway, Japan, and South Korea, and made some job cuts in the US and UK. Their headcount went from 631 to 494. That’s a significant reduction, my friends.
Now, here’s where things get interesting. Graphcore still has $157 million in cash and short-term investments. Not too shabby. But according to their latest annual report, they’re going to need even more money to fund their operations. They’ve prepared a cashflow forecast that goes all the way up to December 2027, and let me tell you, it’s not looking pretty. They’re gonna need more funding before they can break even. So, they’re in talks with potential investors, trying to secure the additional funds they need. Will they be successful? Only time will tell, my friends.
In the meantime, they’re gonna keep pushing forward. They’re gonna keep investing in research and development, expanding the use cases for their tech, and designing their next-gen technology. They’re also gonna focus on increasing adoption of their IPU through the cloud. And speaking of AI chips, there’s some buzz about OpenAI, the company behind the ChatGPT language model. They’re considering making their own AI chips and might even be looking to acquire another company to achieve this. So, things are definitely heating up in the AI chip industry, folks.
But for now, let’s keep an eye on Graphcore. Will they be able to secure the funding they need? Will they be able to turn things around and become a true competitor to Nvidia? Only time will tell, my friends. Stay tuned for more updates on this developing story.